Dec. 5 (BusinessDesk) – The number of house sales in Auckland fell 20 percent on the year in November and prices remained subdued as inventory levels continue to push higher.

There were 757 sales in November versus 947 sales in the same month a year earlier, realtor Barfoot & Thompson said in a statement. The number of sales, however, was up 19 percent from October, when they reached 634 and was 9.7 percent higher than the average for the past three months.

The average sale price was $913,244 in November, up 0.3 percent on the month but down 2.1 percent on the year. The median price of $830,000 was unchanged from October and 4 percent lower than a year earlier.

Inventory meanwhile, continued to rise. New listings rose 4 percent on an annual basis to 1,995 in November and were up 13 percent on the month. Stock available at the end of the month was 25 percent higher than a year earlier at 4,838, the highest number in more than five years, and was up 8.7 percent compared with October.

New Zealand’s overheated housing market – considered a risk to financial stability – has slowed over the past year as Reserve Bank restrictions on more highly-leveraged mortgage lending and tighter credit criteria being demanded by banks made it more difficult for borrowers, even as low interest rates made it easier to service much larger debts. Housing market sentiment had also been weighed down by the change in government as Prime Minister Jacinda Ardern looks to implement policy to restrict the sale of homes and property to foreign investors.

Kiri Barfoot, a director at Barfoot & Thompson, said “interest from local developers and land bankers is returning, but there is still a degree of hesitancy as they await a clearer understanding of future government policy.”

ASB Bank economist Kim Mundy said the high inventory levels coupled with policy uncertainty means there is a risk of “further moderate price falls.” Still, news the central bank is easing the loan to value restrictions will provide some support, she said.

Last week the Reserve Bank announced plans to dial back the restrictions on the level of new bank lending to owner-occupiers with less than 20 percent deposit and leveraged residential property investors, citing recent moderation in the housing market as a good time to start moving. The changes, however, are expected to have a “negligible” impact on interest rates, according to acting governor Grant Spencer.

Barfoot said at the top end of the market buyers are still seeing value in property at current prices with a significant rebound in the number of properties sold in excess of $1 million. Over the month, 55 properties were sold in excess of $2 million and a further 262 for in excess of $1 million, the highest number of high-end property sales since May.

Barfoot & Thompson also sold 62 rural and lifestyle properties in November, the highest in a month since March.